OpenAI Accuses Chinese AI Firm DeepSeek of Copying Its Tech

OpenAI, a prominent player in AI research, has expressed concerns that its fast-rising Chinese competitor, DeepSeek, is exploiting its innovations to accelerate the development of its own AI technologies.

This week, OpenAI and other major U.S. tech companies faced a significant challenge with the unexpected debut of DeepSeek, a Chinese app that mimics the capabilities of ChatGPT but at a fraction of the cost.

According to a report by Bloomberg, Microsoft, OpenAI’s largest investor, is investigating whether data from the AI firm’s technology infrastructure was improperly accessed by a group linked to the Chinese AI startup.

Additionally, in late 2024, Microsoft security researchers identified signs of large-scale data extraction through OpenAI’s application programming interface (API).

The launch of this advanced Large Language Model (LLM) sent shockwaves through U.S. markets, leading to a sharp decline in the stock of Nvidia, the leading American chipmaker.

David Sacks, the newly appointed White House “AI and Crypto Czar,” echoed OpenAI’s concerns, telling Fox News that DeepSeek may have used a technique known as knowledge distillation to enhance its models, potentially by building on those developed by OpenAI.

“There’s substantial evidence that what DeepSeek did here is they distilled the knowledge out of OpenAI’s models,” Sacks stated. “I think one of the things you’re going to see over the next few months is our leading AI companies taking steps to try and prevent distillation… That would definitely slow down some of these copycat models.”

The U.S. is currently considering proactive measures to protect its AI advancements, including regulations aimed at limiting China’s access to cutting-edge chips while directing investments toward the U.S. under the banner of national security.

President Donald Trump’s administration is reportedly contemplating stricter restrictions on the sale of Nvidia H20 chips to China, although these discussions remain in the early stages.

At his confirmation hearing on Thursday, Howard Lutnick, President Trump’s nominee for Commerce Secretary, voiced concerns regarding intellectual property theft and indicated that further U.S. actions may be necessary to protect American AI companies.

“What this showed is that our export controls, not backed by tariffs, are like a whack-a-mole model,” Lutnick stated.

According to CNBC, the U.S. Navy has reportedly instructed its staff to refrain from using DeepSeek’s apps due to “potential security and ethical concerns with the model’s origin and usage.”

Prior to Microsoft’s probe, Sam Altman, CEO of OpenAI, extended his congratulations to DeepSeek on X, commending the company for creating a notable model, especially considering the value it offers at its price point.

“We will obviously deliver much better models and also it’s legit invigorating to have a new competitor! we will pull up some releases,” Altman wrote.

Michaela has no crypto positions and does not hold any crypto assets. This article is provided for informational purposes only and should not be construed as financial advice. The Shib Magazine and The Shib Daily are the official media and publications of the Shiba Inu cryptocurrency project. Readers are encouraged to conduct their own research and consult with a qualified financial adviser before making any investment decisions.

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